About Us

Our Strategy

Dangote Cement is well on the way to becoming one of the world’s leading cement companies and certainly the largest in Sub-Saharan Africa, which we believe will be the next big growth market for cement.

Sub-Saharan Africa is home to a billion people and has a population growth rate of nearly 3% per year. By 2050, the UN estimates, the region will have a population of more than two billion. Furthermore, Sub-Saharan Africa is experiencing greater stability, less conflict and economic growth above global averages. The World Bank estimates that Sub-Saharan Africa experienced GDP growth of 3.0% in 2015, slower than the 4.5% recorded the previous year. It forecast subdued growth of 2.5% for 2016, picking up to 3.9% in 2017 and 4.4% in 2018. It attributes this slowdown, compared with higher growth in previous years, to lower oil prices and the ending of the commodity supercycle.

Despite the recent slowing of its economies, Sub-Saharan Africa will need considerable investment in infrastructure and housing as urbanization increases and economies diversify from dependence on agriculture, minerals and oil towards manufacturing, retailing and services. Increasing personal wealth and the ongoing shift towards younger, more affluent and more mobile populations will also increase demand for property as household occupancy falls.

The combination of these drivers will see Sub-Saharan Africa’s demand for cement increase significantly in the coming years, from about 84Mt at present. Although the market had around 136Mta capacity in 2016, we believe this capacity, much of which is ageing and inefficient, could soon be overwhelmed by demand as population growth, increasing urbanization and rising GDP continue to drive consumption upwards.

Our strategy to expand rapidly and serve this growing market began in 2007 when we took the first steps into manufacturing cement in our home country of Nigeria, which is perhaps Africa’s most attractive market for cement.

Benefiting from competitive pricing, tight cost controls and investment incentives in the form of tax holidays, our strong cash generation in Nigeria funded our expansion both inside our home country and beyond its borders into key African markets where we are building new capacity that will serve the needs of Africans for the coming decades. Our entire production base now consists of 45.6Mta of production and import capacity in a total of ten countries spanning Africa, from Senegal to Ethiopia and down to South Africa. The success of our expansion is seen in the rapid gains in market share we achieved across Africa soon after our plants were opened, despite the presence of strong incumbents.

When we search for new opportunities we look for several key features in the market: the availability of good limestone from which to make cement; the availability of investment incentives, usually in the form of tax holidays; a large population with a growing economy; access to good transport infrastructure; access to low-cost fuel; a cement deficit; strong commitments to investment in infrastructure and housing; and an industry that is characterized by substantial imports, as well as older, less-efficient, more costly and sub-scale plants.

Our strategy in every country is to be the leader on costs, quality and service. We build large, modern, highly efficient plants that combine the latest equipment from Europe, China and beyond to enable us to make higher-quality cement at lower costs, thereby giving us strong competitive advantages. In this way we can sell higher-grade cement at a price that will compete with lower-grade products already in the market. Furthermore, our plants are designed to make the higher-strength cements (such as 42.5 and 52.5 grades) that will increasingly be required as the size and height of buildings increase in Africa’s growing and urbanizing economies. This is an inevitable shift in the market from which we will benefit.

The advantages accrued by our factories will be augmented by the advantages that we can achieve in logistics and procurement, where our size and financial strength enable us to invest in strong distribution capabilities at costs unattainable by smaller and less financially strong competitors.

Operational Regions

Our business is organised into two strategic regions: Nigeria and the Rest of Africa. Each region pursues its business plan in line with the overall corporate strategy set out by the Group’s Board and Executive Management, but mindful of the prevailing conditions in each market.

Nigeria is Sub-Saharan Africa’s largest market for cement, consuming more than 18.6Mt in 2017. From the 29.3Mta capacity of our three factories, all located south of the country’s two main rivers, we can reach every local market in Nigeria with our extensive and market-leading fleet of distribution trucks. In 2017, we sold 12Mt of cement, representing 65% share of the Nigerian market.

Nigeria has substantial limestone deposits and is surrounded by countries that do not have sufficient limestone to make their own cement. Because of this deficiency they must import bulk cement or clinker. In fact, many of the 15 countries in the Economic Community of West African States (ECOWAS), especially those on the coast, are obligatory importers of cement, reliant mainly on imports from outside ECOWAS.

By trading within the ECOWAS region we are able to offer a product that is free of import duties, compared to the non-ECOWAS products the region currently imports.

Because we ourselves import bulk cement into Ghana and clinker into Cameroon, our goal is to substitute these imports for products we make in Nigeria. By manufacturing additional cement in Nigeria, we will increase the capacity utilization of our plants, thereby increasing their efficiency and profitability, which is an obvious benefit to our Nigerian business.

WEST AFRICA

Our operations in West Africa and Central Africa are located in Senegal, Sierra Leone, Ghana, Cameroon and the Republic of Congo. In the coming years we plan to extend our reach with a new plant in Niger and grinding plants in Mali, Ghana, Côte d’Ivoire and Liberia. We will, in time, increase the size of our plants in Senegal and Ethiopia and look to double the scale of our operations in Cameroon.

EASTERN & SOUTHERN AFRICA

In the east and south of Africa we have existing or planned operations in Ethiopia, South Africa, Zambia, Tanzania, Kenya and Zimbabwe. All these countries have ample native limestone, so all our facilities there will be integrated factories, with the exception of the Delmas cement milling plant in South Africa.

Countries on Africa’s east coast are to some degree exposed to cheap imports from Pakistan and the Far East. As a result, our strategy is in most cases to site our factories well inland, where pricing is higher and where imported cement would face additional shipping costs to reach the market.

We have achieved successful market entries in Ethiopia, South Africa, Tanzania and Zambia because of our strategy to be the leader on costs, quality and service. The markets we have entered have been characterized by competitors with older factories that may be smaller-scale or less efficient than our own. As a result, we believe we will surely benefit from the numerous competitive advantages we have achieved in Sub-Saharan Africa’s rapidly growing markets for high-quality cement.